THE LEGAL FRAMEWORK FOR GEOTHERMAL RESOURCES:

A HISTORICAL STUDY

A Report to the Waitangi Tribunal

by

R.P. Boast

Wellington, Auckland

THE LEGAL FRAMEWORK FOR GEOTHERMAL RESOURCES:

A HISTORICAL STUDY

A Report to the Waitangi Tribunal

by

R.P. Boast

i

PREFACE

This report to the Waitangi Tribunal is set out in the

form of a statement of evidence, although due to its length it is

probably unlikely that the whole document will be read in

evidence in its entirety at the Tribunal's inquiry into the

geothermal claim.

This report does not attempt to deal with the "Maori

perspective" on geothermal taonga. This is a task for those with

the necessary expertise, expertise which I do not profess. Nor

does it deal in any way with Maori customary law relating to

geothermal resources. This last omission may strike many people

as strange in a report which attempts to deal with "legal" and

"legal-historical" issues relating to geothermal resources, and

calls for an explanation.

The explanation for the omission of the subject of

customary law is partly simply a matter of my personal complete

lack of expertise. I have on a number of occasions argued that

Maori customary law be given its due place in geothermal (as

indeed in all) resource management, but this is a long way from

claiming expertise in the content of the customary laws. This is

obviously a task for others. I venture to express the hope that

one of the outcomes of the geothermal claim will be a better

understanding of the concepts and workings of Maori customary

law. This can only be achieved, however, if those with the

requisite knowledge feel willing to come forward in order to

enlighten the rest of us.

Maori customary law is omitted not because it is

unimportant, but because it is important. It deserves full

exposition by those who have the capacity to grasp its subtleties

and explain them to others.

Thii report focuses on the formal, normative, rules of the

New Zealand legal system. I have tried to set this law in as

broad a context as possible. I want to make it very clear that

ii

in discussing the common law and statutory framework I am not

implying that these rules ought to be the framework for

geothermal resource management from now on. The simple fact is

that for all practical intents and purposes these have been the

rules until now. It is necessary that they be fully understood.

Some features of the existing framework may have features which

might be seen as being of continued usefulness by this tribunal,

but in the present context I do not regard this as something for

me to judge.

A further feature of this report which calls for

explanation is the fact that the report does not begin with a

discussion of the rules of common law, but begins instead with

the "Fenton Agreement" of 1880. This is quite deliberate.

Issues about ownership of the geothermal resource (meaning the

underground resource) did not become relevant until the mid-

twentieth century. Only then did New Zealand begin to develop

the technology which led to the spectacular engineering successes

at Wairakei and Ohaaki.

The concept of a geothermal "resource", in short, is

recent. Prior to World War II the geothermal "resource", if it

meant anything, meant geysers and hot springs - in other words

geothermal surface features. To the government these features,

the "thermal springs" or the "hot lakes" of the Rotorua-Taupo

region were valuable as an asset for attracting tourists. The

legal regime that was developed was linked to the objective of

developing the tourist industry. The Thermal Springs Acts thus

prohibited any but the Crown from purchasing land in the Rotorua-

Taupo region, thus ensuring public ownership of hot springs

wherever possible .. The Scenery Preservation Act, which was in

part specifically targeted at thermal springs, facilitated

compulsory acquisition from Maori owners, proceeded with at

Waiotapu and Awakeri. A further objective of the Thermal Springs

Acts was to extend the zone of effective government authority.

with the realisation that geothermal energy beneath the

earth was an energy resource came the necessity for the first

iii

time to devise a legal framework for it. In discussing this it

becomes necessary to deal with the common law rules of resource

ownership. This is why this part of the discussion forms the

central, rather than the beginning, section of this study.

This year I was fortunate enough to be commissioned to

write a report for the Tuaropaki and Ngati Tahu trustees on

geothermal issues. This was completed in May of this year and

the report presented to the trustees as Ngatoro-i-Rangi's Legacy:

Maori Interests in Geothermal Resources (1991). This present

report naturally draws to a large extent from the earlier

document. However, this report is a completely different text

and has been completely rewritten. The report for

Tuaropaki/Ngati Tahu was quite different in its scope and

objectives. This report greatly expands on some material in the

earlier report, and omits a great deal of it. Only the sections

on the common law rules and the Scenery Preservation Act remain

essentially the same, though even here there have been many

changes made. I would like to take this opportunity to thank the

Tuaropaki trustees and Ngati Tahu trustees for the earlier

commission and the opportunity to discuss the situation with

them. I would like to thank also the Waitangi Tribunal for this

present commission. Grateful thanks are due also to Tom Bennion

of the Waitangi Tribunal Division, Department of Justice, for his

own helpful report on legislative issues~ and to Dr Evelyn Stokes

of Waikato University whose many papers on this subject have been

of invaluable assistance.

R.P. Boast

1.0

2.0

3.0

4.0

5.0

iv

TABLE OF CONTENTS

INTRODUCTION . . . · · · · · . . . . . · · · · THE FENTON AGREEMENT 1880

A. Introduction · · · B. The Rotorua Region in 1880

C. Fenton at Rotorua · · . . · · · D. The Contents of the Agreement

E. The Land Court Investigates Title to Te

Pukeroa · · · · F. Aftermath at Rotorua · · · THE THERMAL SPRINGS ACTS

A. The 1881 Act · B. The 1883 Act · C. The 1910 Act · · ·

THE SCENERY PRESERVATION ACTS .

A.

B.

Scenery Preservation and Thermal Springs

Compulsory Acquisition at Waiotapu and

Awakeri ..

THE DECLINE OF THE SPA IDEAL

·

· .

· .

6 . 0 THE GEOTHERMAL RESOURCE AS AN ENERGY RESOURCE: THE

COMMON LAW BACKGROUND

A.

B.

C.

Introduction .

Surface Water

Groundwater

D. The Geothermal Resource and Other Energy

E.

Resources

Minerals .

F. The Aboriginal Title Rule and Geothermal

Energy

6.29 Common Law Claims : Summary

.

.

1

2

3

4

6

9

11

14

16

16

22

24

24

24

28

29

33

33

35

35

42

44

48

55

7.0

8.0

9.0

10.

11. a

12.0

13.0

14.0

v

THE BACKGROUND TO THE 1952 AND 1953 ACTS

A. Geothermal Energy for Electric Power

B.

C.

Generation

The British Heavy Water Project

Maori Land at Kawerau

THE GEOTHERMAL STEAM ACT 1952 . .

A.

B.

C.

D.

Geothermal Power and Water Power .

The Geothermal Steam Act in Parliament .

Discussion of Maori Issues . . .. .

The Geothermal Steam Act 1952 Analysed .

THE GEOTHERMAL ENERGY ACT 1953

A. Background ..

B. The Geothermal Energy Bill in Parliament

C. The Geothermal Energy Act 1953 Analysed

D.

E.

Verdict on the Geothermal Energy Act

Amendments

THE ROTORUA CITY GEOTHERMAL ENERGY EMPOWERING ACT

1967 . . . . . . . . . .

A. Effect of the Act

B. The Act in Operation

DAMAGE TO SURFACE FEATURES

THE WATER AND SOIL CONSERVATION ACT 1967

A. Introduction

B. Maori Values

C. The Water Act and Geothermal Issues

D. The Water and Soil Conservation Act:

Summary . . . . . . . . . . . . . . . . .

MANAGEMENT PLANNING . . . . . . . . . . . . . . . . .

RECENT DEVELOPMENTS . . .

A.

B.

Resource Rentals

Structural Changes

56

56

59

64

65

65

66

71

72

73

73

74

76

80

81

82

82

83

84

88

88

88

90

94

95

98

98

101

15.0

C.

D.

vi

Sale of Geothermal Assets

Other Recent Developments

102

103

SUMM.ARY . . . . • . • . . • . • . . . • . . . . . .. 103

The Legal Framework for Geothermal Resources:

A Historical Study

1.0 INTRODUCTION

1.1 My full name is Richard Peter Boast. I am a senior

lecturer with the faculty of law of Victoria University of

Wellington, where I teach courses on environmental law, Maori

land law, legal history, indigenous peoples and the law and

public law. I have an LL.M from Victoria University and an M.A.

(1st-class honours) in history from Waikato University. In

relation specifically to geothermal issues I was commissioned by

the Manawhenua section of the Ministry for the Environment to

write a working paper for the Resource Management Law reform

process on Geothermal Energy: Maori and Related Issues

(published by the Ministry for the Environment in 1989), and this

year I have prepared a report for the Ngati Tahu and Tuaropaki

trustees entitled Ngatoro-i-Rangi's Legacy:- Maori Interests in

the Geothermal Resource (1991).

1.2 I regard myself primarily as a legal historian, and this

report is intended to focus primarily on those aspects of New

Zealand's legal history which impinge upon the ownership and

management of geothermal resources. I have taken the view that a

consideration of the implications of the Treaty of Waitangi is a

matter for counsel to address by way of submissions than

something to be traversed in evidence. Nor is this report

intended to traverse matters concerning traditional use of the

geothermal resource. Although I am familiar with some of the

Rotorua and Taupo minute books of the Native Land Court, which do

contain a certain amount of evidence regarding traditional use of

the resource, it seems unnecessary for me to present this

material to the Tribunal. For the Taupo region this has already

been covered in the many scholarly and valuable reports and

papers by Dr Evelyn Stokes which are already on the record and in

any event a separate report on traditional use of the use as

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documented in early travellers' records and the Minute Books of

the Native Land Court will be commissioned by the Tribunal.

1.3 My focus is on legal history. I have, however, decided to

interpret this fairly broadly. I have not confined myself to a

discussion of the background to, and subsequent history of, the

Geothermal Energy Act 1953. Although the principal focus today

is on the value of the geothermal resource as an energy resource,

for a much longer period the principal interest of government had

much more to do with the scenic and therapeutic qualities of

surface geothermal features. The narrative will begin,

therefore, with the Fenton Agreement of 1880 and with its

offshoot, the first Thermal Springs District Act. Some attention

will be paid to the first major investigations of title by the

Native Land Court in the Rotorua and Taupo regions (although it

is not possible to cover this comprehensively). This will be

followed by a consideration of the Scenery Preservation

legislation, the management of the resource by the Crown in the

years before World War II, and finally by a study of the

background to the enactment of the Geothermal Energy Act 1953.

This will include a detailed covered of the relevant common law

rules.

1.4 I am mindful of the fact that New Zealand's geothermal

resources are not confined to the Rotorua-Taupo region, but are

to be found in the Bay of Plenty, the Wairoa area and at Ngawha

in Northland as well. I have, however, decided to focus on

Rotorua-Taupo for present purposes. The story of land alienation

around Whakatane is a complex story in its own right, involving

raupatu issues to a large extent; and of course the Bay of

Islands has its own complicated story. I do not feel that I

could do justice to these important histories in this report. In

my opinion, the central and principal history follows a clear

line from the Fenton Agreement through to the Thermal Springs

Acts and the Scenery Preservation Acts, and it is on this I have

decided to concentrate for present purposes.

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2.0 THE FENTON AGREEMENT 1880

A. Introduction

2.1 The Fenton Agreement of 1880 was the precursor to the

first of the Thermal Springs Acts. It also paved the way for the

modern settlement of Rotorua and for a flood of investigations of

title by the Land Court in the Rotorua-Taupo region in the early

1880s. It forms a convenient starting-point for the narrative.

2.2 On 25 November 1880 at the Tamatekapua meeting house at

Ohinemutu an historic agreement was concluded between the Crown

and Maori chiefs of the Arawa federation, principally from Ngati

Whakaue. The Crown's representative was Francis Dart Fenton,

then aged about forty, who had already made a name for himself as

Chief Judge of the Native Land Court. Unlike the Treaty of

Waitangi, the Fenton Agreement was directly negotiated with Arawa

chiefs on Arawa territory and remains of vital importance to the

present day - as the recent re-surfacing of the issue of medical

treatment reminds us. As to whether Arawa ever signed the Treaty

of Waitangi or not, I note only a reference in James Cowan's The

New Zealand Wars where Cowan, when he discusses Arawa's refusal

to join the Kingitanga, quotes the words of Temuera te Amohau at

the meeting at Paetai in 1857:-

"One of our chiefs, Timoti, was the only man of the Arawa

people who signed the Treaty of Waitangi, but we shall not

depart from the pledge he then gave. We will not join the

king tribes. My king is Queen Victoria. ,,1

2.3 The proliferation of recent commentary on the Treaty of

Waitangi takes no account of the fact that the Treaty of Waitangi

was not the only formal compact concluded between the Crown and

the tribes. There has been no attention given to the

constitutional position of texts such as the Fenton Agreement or

- to take another example - of the Aotea Agreement of 1881 which

brought the independence of the Rohe Potae (the so-called "King

Country") to a close. If it was the case that the Maori ceded

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this country to the Crown, is it not possible that the process of

cession was in fact partial and gradual and took many years to

complete?

B. The Rotorua Region in 1880

2.4 In 1880 the Rotorua region was part of a zone of

autonomous Maori authority. It should not be assumed, simply

because the hot springs of the area were already an

internationally-famed tourist attraction, that the area was under

the effective control of the state. In fact it lay completely

outside the formal structures of government. At Rotorua the

principal agency of authority was not the state but the Komiti

Nui 0 Rotorua, the "great Committee" of chiefs. The Komiti held

regular meetings at the Tamatekapua meeting house and had

appointed a secretary to conduct the Komiti's formal business.

The Komiti had organised its own process of investigations into

customary ownership of land complete with formal hearings after

which pieces of land were awarded to claimants on the basis of

Maori custom. 2 Fenton himself, in his report to the government

after the conclusion of the agreement, describes the Komiti as

follows 3 :-

"I should add that I found in existence, at Ohinemutu, a

regularly organised head body with Chairman, Secretary and

officers. It was constituted as a Land League for the

prime object of preventing alienation to the Crown, and in

a secondary degree, of obstructing or assisting, as the

case may be, in association with private persons, but it

subsequently assumed other powers and duties, and had

acquired a position of some importance, being accepted by

the tribe as the Witanagemot was accepted by our fathers,

with little more than its own influence and strength to

enforce its decrees."

2.5 Although the region was effectively under Maori control,

life in the Rotorua region had nevertheless been much affected by

European contact. The Christianity of the missionaries had

- 5 -

penetrated deeply: the Maori villages of the region were, of

course, Christian communities. The Arawa tribes had mostly

fought on the Crown's side during the wars of the 1860s. Arawa

was in a strategic and exposed position during the wars and had

provided a vital service for the Crown in blocking access to the

main theatre of operations in the Waikato to pro-Kingitanga

contingents from the East Coast4. Some Arawa officers rose to

high positions in the Crown's armed forces. The social

dislocation caused to Arawa by the wars and the extensive

fighting in their region is an uncharted subject, but the effects

must have been considerable. The wars had also led to a

programme of road construction, and by the mid-1870s a road ran

from Tauranga to Taupo via Ohinemutu and Atiamuri on the Waikato

riverS. With the road had come surveyors. The first telegraph

office in the region was opened in 1871 6 . Most importantly

Rotorua was the centre of a rapidly-growing tourist trade centred

on the lakes and hot springs of the region7 . For most tourists

the highlight of their visit was the Pink and white Terraces of

the Rotomahana area. The terraces, which were soon to be

obliterated in the devastating eruption of Mt Tarawera, were

located in the territory of Ngati Tuhourangi, who were certainly

doing very well economically out of the tourist trade in their

region8 . And, at Whakarewarewa the local people, "well aware" as

Stafford says9 "of the commercial value of their springs" had

constructed a number of "comfortable whares" for tourists (at 5s.

a week). It was this thriving trade which had brought some

European hotelkeepers and storekeepers into the district. The

tourist trade must also have had important social and economic

effects, but it likewise remains an uncharted subject.

2.6 These European residents were obliged to enter into lease

arrangements with the Maori landownders. Strictly speaking such

leases were legally void, a violation of the pre-emption doctrine

(a lease, as an estate in land, could only be effective following

the extinguishment of the native customary title). Fenton for

some reason harbored a particular aversion for these European

"squatters,,10.

- 6 -

2.7 In 1880 the whole Rotorua region was still uninvestigated

Maori customary land. Apart from a few minor early and abortive

inquiries, the Land Court had never sat there11 . Thus land

remained wholly Maori owned; control of the tourist trade was

principally in Maori hands; and local Maori had devised their

own system for regulating title without having recourse to the

Land Court. Arawa had indeed strenuously resisted the coming of

the Court into their region, and only at Maketu had its impact

been in any way significant l2 . The European population of the

region was tiny and basically lived under Maori sufferance. But

the situation was an unstable one. Government interest in the

region was growing. The coming of the road had involved of

necessity the coming of surveyors, and there had been an incident

at Ohinemutu in 1873 when two surveyors, Henry W. Mitchell and

C.O. Davis, had been forced to leave l3 . The road and the

telegraph had reduced the Rotorua region's isolation to some

degree and the tourist potential of the region meant that its

isolation and autonomy could not continue indefinitely.

C. Fenton at Rotorua

2.8 Although Rotorua chiefs such as Rotohiko Haupapa were keen

to modernise the region and to develop education, the idea of

concluding some sort of formal agreement between the Rotorua

chiefs and the Crown appears to have originated in Fenton's own

brain. Quite what his objectives were is not altogether clear.

From what is known of Fenton14 , and from his evident distaste for

the European tenants at Ohinemutu, it is possible that his main

objective was initially to regularise land ownership around

Rotorua by means of some process which would give an influential

role to the Native Land Court. The government's main objectives

were to make the area more attractive to tourists, and to obtain

land in the region for the Crown. This can be seen by the formal

instructions telegraphed by James Bryce to Fenton, on circuit in

Hawkes Bay at the time, in November 1880 15 :-

"Mr Rolleston [the Native Minister] who is absent in

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Canterbury requested me to reply to your telegraph of the

5th instant reo the Rotorua business [not on the file].

Both he and I would be very glad if you would return

overland as you suggested and endeavour to ascertain on

what conditions the Maoris would be willing to dispose of

enough land near Rotorua to remove the present

difficulties and obviate future ones in respect to Hotel

accommodation for visitors to the lake. Govt. would agree

to almost anything which would be effectual as township

should however be formed to secure sanitary regulations

being enforced. This might be secured either by sale or

by lease. If they [illegible] ..... the latter the lease

should still be a long one. However you know what is

required and Govt. will look forward with interest to your

report in the hope that you will be able to advise some

course which will render the Lake Country more agreeable

to visitors that it is at present."

These instructions gave Fenton a remarkably free hand. Bryce and

Rolleston seem to have been more than happy to let Fenton handle

things as he wished. Although Rolleston was later to be somewhat

taken aback when confronted with the text of the agreement Fenton

was to conclude, he nevertheless needed little persuading to

accept it and it was subsequently ratified by the government

without difficulty.

2.9 Following receipt of his instructions Fenton made his way

from Napier to Rotorua via Taupo, an arduous journey in those

days, taking with him Wiremu Hikairo, an Assessor of the Native

Land Court and (in Fenton's words) "a landowner and a man of

importance in the Rotorua country,,16. Fenton was at Ohinemutu

for about a fortnight. During this time he had a number of

meetings with Ngati Whakaue. In his report Fenton stated that he

visited the "neighbouring tribes,,17 as well as Ngati Whakaue. He

certainly discussed matters with representatives of Ngati

Tuhourangi at Ohinemutu but what other tribes, if any, he visited

is impossible to say. The agreement which Fenton concluded

appears, to have been primarily an agreement with Ngati Whakaue

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only. A separate, and much shorter, agreement was concluded with

Tuhourangi l8 . On his way home to Auckland Fenton travelled from

Rotorua to Maketu on the Bay of Plenty Coast, also in Arawa

territory, where he had some further discussions with Arawa

chiefs.

2.10 The Fenton agreement is dated November 25th, 1880. The

relevant Maori Affairs Department file contains a draft of the

agreement in Maori and Fenton's own translation of this into

English, as well as a separate English text which may have been

re-worked from Fenton's translationl9 . There seems no reason to

doubt that the contents of the agreement were worked out in Maori

by Fenton (who spoke and wrote Maori fluently) and the chiefs,

and that the Arawa chiefs present comprehended perfectly well

what was transpiring. As to the actual drafting of the agreement

Fenton says:-

"The agreement which I enclose is abundantly signed, and

will be faithfully kept. There may be some difficulty as

to the boundary lines between this tribe and that of the

adjoining tribe, Tuhourangi, but that difficulty will be

the duty of the Native Land Court to overcome. It will

not concern the government ..... The several items of the

agreement are mostly of my own proposing - The natives put

themselves pretty well into my hands with the exception of

not permitting cession to the Crown, and I inserted the

conditions which under the circumstances I thought most

advantageous - remembering that the town would not be a

commercial town nor for many years to come couldn't [sic]

be much interested in agriculture, but that its prosperity

would be based on circumstances entirely exceptional. ,,20

2.11 Whatever one thinks of Fenton or his objectives, it has to

be conceded that the agreement he devised was a remarkable

achievement. It was no small feat to have won the confidence of

the Ngati Whakaue chiefs in the way he did. Fenton's attitude

towards the chiefs seems to have ambivalent. With some of them

he seem.s-to have developed a reasonably close friendship,

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evidenced by the· flood of telegraphs in Maori which passed

between them and Fenton. On the other hand there certainly was

an element of condescension in Fenton's general attitude, as is

shown in the revealing remark made in his report. Here he urged

the government to make haste in giving effect to the agreement

and that government:-

" ... should leave nothing unfinished or postponed. Dilatory

and prevaricating as they are themselves, they [the

chiefs] do not endure these qualities in others. ,,21

D. The Contents of the Agreement

2.12 The agreement is entirely concerned with future

arrangements for the new town of Rotorua. Following a survey to

be conducted by the Chief Surveyor, the first principal step was

to be a Native Land Court adjudication of the block later to be

known as Pukeroa-Oruawhata.

1. The whole of the land commencing on the North of Te

Pukeroa, going on to the Puerenga River, on the

Rotorua Lake and extending on to the mountains must

be adjudicated upon by the Native Land Court of New

Zealand, but excluding the Maori settlement of

Ohinemutu22 .

Following the adjudication and the survey of the block boundary

Mr Smith was to survey out the new town sections. The agreement

carefully detailed the arrangements regarding the new town as

follows:-

3.1 The land that lies between Te Pukeroa and Rotorua

shall be left for a settlement for the Maoris, but

the present road shall be widened and carried on to

the Town.

3.2 Te Pukeroa to be a Reserve for Public Recreation

for everybody, be they Europeans or Maoris. This

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Reserve shall be vested in certain Europeans and

Maoris, to be chosen by the Committee.

3.3 Persons who own portions of the Pukeroa Block shall

be paid for the same by pieces in the Town. This

shall be carried out by the Committee of Rotorua.

3.4 The piece of land owned by Roman Catholics in the

Pukeroa Block shall be exchanged for a piece in the

Town.

3.5 A skilled doctor shall be located in the Town.

3.6 All the medicinal waters within the Town shall be

Public Reserves under the management of the doctor,

who may make laws regulating their use23 .

It was provided that the streets of the town were to vest in the

Crown, that land would be given "without payment" for a water

race from the Utuhina River to the town, and that "all Maori

patients shall be received into the hospital free of charge,,24.

2.13 Some attention was given to questions of law and order and

to ensuring that the Pakeha and Maori communities would be able

to live peaceably together. It was provided in Clause 7 that

"when the Town shall have grown up and become of importance" the

government would appoint a resident Magistrate. The Magistrate,

together with the doctor and a Maori representative chosen by the

Komiti would control the issue of licences for taverns 25 .

Provisions were made regarding the fencing of stock - a frequent

source of trouble between Maori and Pakeha in other areas 26 .

2.14 Arguably, the most important sections of the agreement

related to the leasing of land. The idea was that the Town

sections at Rotorua would not be sold but would be leased and the

income be available for the Maori Owners. The leases were to be

on advantageous terms to make them attractive to purchasers, who

presumaply would be expected to pay a lump sum plus an annual

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rental. The leases were to be sold by auction in Auckland and

were to be for a period of 99 years. The auction and the

administration of the proceeds were to be conducted by the

Commissioner of Crown Lands at Auckland27 .

2.15 Essential to the success of the scheme, in Fenton's view,

was advertising the sale of the leases in Australia and India,

emphasising the therapeutic qualities of the hot springs. Fenton

states in his report:-

"I nearly forgot to state that I persuaded the Maoris that

the scheme should be advertised in the adjoining British

possessions, including India. May I take the liberty of

suggesting that Dr Hector's services would be of great

value in performing this work and that the official

Gazette would be a good medium. That gentleman is well

acquainted with the peculiar and various character of

the ..... mineral waters of the place." 2 8

E. The Land Court Investigates Title to Te Pukeroa

2.16 The first step in the process of implementing the

agreement - and of land alienation in the Rotorua district - was

the Native Land Court's adjudication of title in the case of the

Pukeroa-Oruawhata Block. This is the major block of land which

stretches east from Ohinemutu and which now accounts for most of

the modern city of Rotorua. The case was heard not by Fenton but

by Judge Symonds, the hearing beginning on 29 January 1881 with

judgment being given on 28 June 1881. Fenton, however, retained

a remarkable degree of control over events from behind the

scenes. He was engaged in a very active correspondence not only

with the Ngati Whakaue chiefs29 , but also with others sent by

Fenton to help Ngati Whakaue in getting their case through the

Court, and with the presiding judge himself 30 . He was

furthermore in constant contact with Rolleston and other members

of the government.

"

- 12 -

2.17 After the· initial burst of enthusiasm some of Ngati

Whakaue began to have their doubts about the whole scheme.

Fenton sent Gilbert Mair to Ngati Whakaue ostensibly to assist

them, although his principal task was to keep Fenton informed of

events at Rotorua and to ensure that Ngati Whakaue continued with

the project. On 1 July 1881 Mair telegraphed Fenton at

Rotorua31 :-

"Reached here last night after ten o'clock. Ngati Whakaue

will get all the block except 45 acres to Ngati Tuara. I

am to get Komiti this 'afternoon to discuss the

restrictions. The people are pleased that some one has

come to help them in the matter but I am afraid they are

not so keen about the scheme as they were originally.

Indeed I find that some of them are dead against it. The

Komiti have been trying for several days to prepare lists

of names for certificate. Their difficulties in this

direction may perhaps induce them more readily to accept a

board of trustees instead. There is a strong feeling

against all sharing alike .. ... r foresee a good deal of trouble.

WG MAIR"

Fenton also sent E.W. Puc key , another Land Court Judge, "to watch

the Court for the Crown,,32. Puckey likewise kept Fenton closely

informed as to events; Fenton in turn made sure that political

difficulties with the agreement in Wellington were smoothed

over33. Fenton's tenacity and energy certainly were remarkable,

although whether what was proceeding was really to Ngati

Whakaue's advantage is another matter.

2.18 Although the hearing lasted, by fits and starts, for

nearly six months and generated quite a volume of evidence, Judge

Symonds' decision is amazingly brief (9 short paragraphs). The

case usefully illustrates the process of adjudication of title as

it was typically conducted by the Land Court. Various Arawa

tribes advanced claims to the block: Tuhourangi, Ngati

Rangiwe~ehi, Ngati Uenukukopako. The evidence discloses a

- 13 -

complex tribal history and subtle linkages of interests between

the tribes. Ngati Whakaue went last and had essentially only one

witness, Hamuera Pango, who advanced claims to the block based on

the standard categories of conquest, permanent occupation,

fortification, cultivation, burial places, and "mana over this

and the adjacent lands". In his cryptically brief judgment,

Judge Symonds awarded the whole block to Ngati Whakaue,

completely disallowing the claims of all other Arawa tribes. The

other successful claimants were Ngati Kea and Ngati Tuara, two

small groups who had fled to Rotorua as a refuge from the

powerful Waikato tribes and who had been granted by Ngati Whakaue

a small piece of land at a place known as Tarewa34 .

2.19 The next step in the process was for Ngati Whakaue to hand

in a list of names, who would then be recognised by the Court as

owners. This technique of leaving it to successful block

claimants to work out their own names was also routine: only if

names in the lists were challenged or if there were rival lists

did the Court become involved in this stage of the process.

Although lists of names finally were prepared, this was achieved

only at the cost of considerable tension being generated within

Ngati Whakaue. According to Puc key there was much distrust

between the "people" and the chiefs, as well as a considerable

amount of sheer personal jealousy - all no doubt exacerbated by

the novel nature of the Land Court and its workings to Ngati

Whakaue 35 . As if the tensions within Ngati Whakaue were not

troublesome enough, the other Arawa tribes were far from happy

about being excluded from the Pukeroa-Oruawhata Block as a

consequence of Judge Symonds' decision. On August 12 Fenton

received a letter from Makari Hikairo and others applying for a

rehearing of the original case:-

"Under pressure of pain for lost land (He karanga na te

mamae ki te whenua iwio), we women make bold to write this

letter to you: an application for the rehearing of Te

Pukeroa-Oruawhata Block, situate at Ohinemutu ..... recently

heard by the Native Land Court ..... The grounds of our

~pplication are these:

- 14 -

1. We are not clear as to the reason why the Court did

not fully consider the many generations during which we

cultivated and occupied the pieces in the northern end of

the Block.

2. We are not clear as to ground on which the Court

stated there remained no mana of Ngatirangiwewehi on all

its pieces of land at Ohinemutu.

3. Our brother W. Hikairo was sent elsewhere as

Assessor for some Judges at some other Courts, while the

Court was sitting here at Ohinemutu. W. Hikairo is the

one best able to set forth our claims and all our rights

to the pieces of the land at the northern end of this

Block.

4. During January last the "Komiti Nui 0 Rotorua"

adjudicated upon those pieces. They were investigated

before the four judges of that Komiti, and we appears to

state our claims before that tribunal, and some of those

pieces were awarded to us by reason of our claims under

Maori custom." 36

This may indicate, indeed, that the Komiti was far better able to

appreciate the nuances and complexities of ownership around the

region than was the Land Court itself. The Court's approach

forced a complicated reality into a very Procrustean bed, leaving

much dissatisfaction in its wake. However ,no action appears to

have been taken with regard to the application from the women of

Ngati Rangiwewehi.

F. Aftermath at Rotorua

2.20 One almost immediate consequence of the Pukeroa-Oruawhata

Block hearing was a sudden flood of hearings concerning other

blocks in the region37 . For many years the Rotorua region had

been a bastion of resistance to the Court. Now, within a space

- 15 -

of months, the whole structure of carefully-managed resistance

simply caved in. The pattern in Rotorua was just the same as

occurred in every other place where the Court was finally

admitted after decades of resistance38 .

2.21 Legislative backing for the Fenton agreement came with the

Thermal-Springs District Act 1881, which gave to the Crown the

necessary statutory authority to act as Ngati Whakaue's agent in

the administration of the leases and the collection of rent.

Fenton had with characteristic energy devoted much effort to

advertising the leases in Australia and elsewhere, and the first

auctions were very successful. Fenton and the Ngati Whakaue

chiefs were delighted at the apparent success of the scheme. One

contemporary report of the auction states:-

"At the close of the sale ..... a disturbance was visible at

one end of the room ..... it was Fenton, the Chief Judge

.... . in an ecstacy of delight performing a haka with two

old Rotorua savages ..... The ecstacy of the trio arose from

the success of the Rotorua scheme and the prospect of

manipulating £2,700 per annum . ..39

In May 1881 the new town of Rotorua was surveyed out by A.B.

Morrow. Areas were reserved for a hospital, sanatorium ground,

and a railway station.

2.22 It was not long, however, before things began to turn very

sour. Initial interest in the scheme waned. The new town of

Rotorua, stigmatised by the European settlers at Ohinemutu as

"Rotten Egg Town" failed to grow as planned. This seems mainly

to be due to the deep economic recession of the 1880s. The

eruption of Mt Tarawera in 1886 was a devastating blow,

destroying the Pink and White Terraces (the major tourist

destination in the region) and reducing the formerly prosperous

Ngati Tuhourangi to virtual destitution. Existing lessees began

to default, and unallocated leases became unsaleable. Ngati

Whakaue were caught in a difficult situation. Locked into the

agreeme,nt and caught by the provisions of the Thermal Springs Act

- 16 -

(which prevented the alienation of land to anyone but the Crown)

they were unable to sell their land to anyone else. The

agreement, far from being a boon, turned out to be a millstone

around the necks of Ngati Whakaue. Unable to develop or sell the

land, deprived of rental income but not themselves able to take

any steps to collect it from the lessees, Ngati Whakaue took the

only option open to them. In 1889 Pukeroa-Oruawhata was sold to

the Crown.

2.23 More accurately, the Crown bought out the shares of nearly

all of the owners of the block. The total amount paid for

Pukeroa-Oruawhata was £9,750. The Crown was not able to acquire

all of the shares as a handful of owners refused to sell. For a

number of years the block remained technically Maori freehold

land (albeit owned almost wholly by the Crown). The Crown did

deal with parts of the block by Proclamation - for example on 2

March 1896 part of Pukeroa-Oruawhata was taken or set aside

(depending on what view one takes of the status of the Pukeroa-

Oruawhata Block) for railway purposes. The Crown could have

applied to the Land Court to have its majority interest in the

block partitioned out, but never did so. Parts of it were set

aside by Proclamation but the formal status of Pukeroa-Oruawhata

remained unchanged until 1910 4°. In this year the whole block was simply converted to Crown land by statute, extinguishing the

remaining private interests and saving the Crown the trouble of

bringing a partition application and the costs of having the

block re-surveyed.

3.0 THE THERMAL SPRINGS ACTS

A. The 1881 Act

3.1 The first Thermal-Springs Districts Act 1881 was a follow-

up to the Fenton Agreement, and its primary objective was to give

the agreement legislative effect. After its enactment the

agreement was formally ratified by the Governor, Sir Arthur

Gordon, on behalf of the Crown. Endorsed on the Maori text of

the agr~ement on MA 13/79 one finds the following:-

- 17 -

"In pursuance of the Thermal Springs District Act 1881,

and in execution of the powers conferred upon me by the

5th section of the said Act, I hereby contract with the

Tribe of Ngati Whakaue in terms of the above written

instrument.

Dated the 16th day of February 1882

Signed: Arthur Gordon

Governor"

The formal endorsement, it will be noted, contracts specifically

with Ngati Whakaue. The separate agreement with Tuhourangi had

caused some concern to Rolleston, and he had earlier raised this

with Fenton. On February 14, 1882 he telegraphed Fenton:-

"How about agreement with Tuhourangi is that to be signed

by the Governor. Rolleston.,,41

But Fenton replied:-

"The agreement with Tuhourangi tribe need not be noticed.

Their claim to this block [i.e. pukeroa-OruawhataJ was

disallowed. Presently I hope to see a town on their land

at Rotomahana.,,42

This demonstrates, if nothing else, the remarkable degree to

which the government was willing to let Fenton take charge of the

whole process.

3.2 Although the agreement and the outcome of the Pukeroa case

had caused dissatisfaction amongst the other Arawa tribes, and

some elements of Ngati Whakaue began also to have their doubts,

other chiefs were committed to the new relationship with the

Crown. Chief amongst these was Paora te Amohau of Ngati

Whakaue 43 .

- 18 -

3.3 The Thermal-Springs Districts Act 1881 was described in

its long title as an act "to provide for the settlement of the

Thermal-Springs Districts of the Colony". The area was intended

to pass out of the autonomous Maori zone and into the zone of

European settlement and effective government control. It is not

suggested that this was contrary to the wishes of Ngati Whakaue;

the issue that arises with the legislation is what is meant by

the "Thermal Districts". Even those groups that favoured

settlement in their territories and the building of closer

relationships with the Crown were not willing to do so on the

basis of an agreement that, whatever its merits, had been

concluded with just one Arawa tribe.

3.4 The Preamble to the 1881 Act read:-

"Whereas it would be advantageous to the colony, and

beneficial to the Maori owners of land in which natural

mineral springs and thermal waters exists, that such

localities should be opened to colonization and made

available for settlement: And it is expedient that powers

should be given to the Governor enabling him to make

arrangements for effecting that object ... "

The Act allowed the Governor to proclaim "localities in which

there are considerable numbers of the ngawha, waiariki, or hot or

mineral springs, lakes, rivers or waters,,44. Once such an area

had been proclaimed:-

" ... it shall not be lawful for any person other than Her

Majesty to acquire any estate or interest in Native land

therein. ,,45

Thus only the Crown could buy Native land in areas subject to the

Act.

3.5 It is important to put this in its historical context. By

1881 the pre-emption doctrine in Article II of the Treaty of

Waitangi.had been substituted by the process of investigation and

- 19 -

award of title by the Native Land Court acting under the Native

Land Acts, the first of which was enacted in 1862. The

underlying principle was that of free alienation following

investigation - provided the Land Court had issued a title to it,

any block was freely alienable46 . The Thermal Springs Act was

thus an exception to the general operation of the Native Land

Acts. Following an investigation by the Court, only the Crown

could purchase; or, to put it another way, the Crown had a

complete monopoly of purchase of Maori land in areas subject to

the Thermal Springs Acts. The legislation was not in any sense

confiscatory, nor did it change the status of any Maori land. A

number of hypotheses can be advanced to explain why this approach

was taken. One is that a conviction had developed on the part of

government that unfettered private purchase of investigated Maori

blocks led to all kinds of abuse, typified by the sorts of

practices that occurred in Hawkes Bay and which were explored

(although not remedied) by the Hawkes Bay Native Lands Alienation

Commission of 1873 47 . It is significant that in the later

nineteenth century, similar regimes were adopted for those areas

of remaining Maori autonomy - the King Country (Rohepotae),

Rotorua and Te Urewera. A common feature was that in each case

purchase of land was restricted to the Crown48 . Another

explanation for the Thermal Springs Act is that the government

wanted to ensure that the thermal areas were not all sold off

into private lands, as had happened at Wairakei49 . Further

research is necessary before either hypothesis can be fully

tested. For present purposes it is enough to note the

similarities in approach adopted in respect of the King Country,

the Rotorua region and Te Urewera.

3.6 The Fenton agreement is nowhere referred to in the text of

the 1881 Act, but it was discussed fully in parliament. The four

Maori MPs and opposition members of parliament (a key figure in

the opposition at the time was Sir George Grey) pointed out that

although Fenton's agreement had been concluded only with Ngati

Whakaue, the act itself had a much wider potential ambit - in

fact anywhere where there were thermal springs50 . The

government's response was to amend the act by restricting its

- 20 -

application to the counties of Tauranga - which then included the

whole Rotorua region - and East Taupo. This, of course, was

still an enormous area, extending well beyond the limits not just

of Ngati Whakaue but of the entire Arawa confederation, extending

into the territories of Tuwharetoa, Ngati Awa, Ngai Te Rangi and

others. The first area proclaimed was the Pukeroa-Oruawhata

block at Rotorua/ an area of 3/200 acres, proclaimed on 13

October 188151 . The concerns of Major Te Wheoro and Sir George

Grey were fully realised/ however, with the next proclamation,

which proclaimed a staggering area of 616,890 acres to be subject

to the Act52 ; and on the same day, 27 October, a substantial

area in north of Taupo was likewise proclaimed. The effect was

that the government at a stroke acquired a complete monopoly of

land purchase in an enormous area stretching from Tauranga to

Taupo.

3.7 The Act made further provision relating to thermal areas.

Section 5(3) empowered the Governor to:-

" ... treat and agree with the Native proprietors for the

use and enjoyment by the public of all mineral or other

springs, lakes/ rivers and waters."

Any by section 6(7) the Governor was empowered to:-

" ... manage and control the use of all mineral springs, hot

springs, ngawha, waiariki, lakes, rivers and waters, and

fix and authorise the collection of fees for the use

thereof ..... with the consent of the Native proprietors, to

be ascertained in such manner as he may think fit."

Quite obviously this reflects one of the principal objectives of

the agreement and the legislation - to give the government a pre-

eminent role in the development of a tourist industry based on

the hot springs.

3.8 Ian Rockel, in his book Taking the Waters: Early Spas in

New Zealand (1986) has argued that William Rolleston, Minister of

- 21 -

Lands 1879-1884, "had a particular interest in developing spas in

New Zealand on the European model. The favoured localities were

Rotorua and Te Aroha (also within the ambit of the Thermal

Springs Act after the 1881 proclamations) in the North Island,

and Hamner in the South Island. Certainly the legislative

machinery of the Thermal Springs Act enabled this to be achieved

in the North Island. The government had especially extensive

powers to initiate development at Rotorua, since after 1890 it

owned all the land in the town, with all the residents on 99-year

lease (not until 1920 was it possible to purchase the freehold).

Still, it is hard to see why, if developing spas were the main

object, it was necessary to proclaim such an extensive region

under the 1881 Act. Developing the tourist industry was unlikely

to have been the sole, or perhaps not even the principal,

objective of the government's action.

3.9 In order to form a true understanding of the effect of the

Thermal Springs Act, it needs to be remembered that the Crown had

already become involved in the purchasing of land in the

proclaimed area well before 1881 (although not at Rotorua

itself). An example is the Tauhara North block, which passed the

Land Court as early as 1869. The block, which included a number

of hot spring areas, was vested by the court in precisely two

persons, Hare Reweti Te Kume and Hare Matenga Taua. In 1873 a

large section of this block was cut off and sold to the Crown.

In 1887 Hare Matenga explained what had happened53 :-

"What I wish to explain now is the sale of this land. In

1873 this land was sold. The man who bought it was Mr

Mitchell. Reweti Te Kume was the only person who received

the money at that time. In 1875 I received some money

from Mr Mitchell - I received £100. I don't know what Te

Reweti got. On the last occasion I received money I don't

know what year it was. £15 was the amount of the last

payment made to me. When that was done then the land was

cut up for the government survey claims and start the

sale. The part cut off was from Te Aratiatia straight to

aipaua but it was one mile distant from the swamp at

- 22 -

Rotokawa. ". The reason I was so long before accepting the

money was because I didn't want to sell - and the interest

on the survey lien was increasing year by year. The part

sold was on the western side of the line I speak of. That

was why it was sold; because of the survey - and the

money Te Reweti and I got was what was left after the

survey lien was paid."

This illustrates usefully the point that the problems which

bedeviled the alienation of Maori land (quite apart from the

extra complication of the Thermal Springs legislation) were as

much to the fore in the Taupo region as they were anywhere else

in the country.

B. The 1883 Act

3.10 The purpose of the Thermal Springs District Act 1881

Amendment Act 1883 was essentially to give formal recognition to

the Fenton Agreement, and also to a subsequent arrangement made

between the Crown and Ngati Whakaue in 1883 (the "Clarke

Agreement"). On 25 February 1883 Henry Clarke had met the Ngati

Whakaue chiefs and it was agreed (quoting from the preamble of

the 1883 Act) that "all those portions of the arrangement made

between the said Francis Dart Fenton and the said tribe which

remained unfulfilled should be carried out, subject to certain

modifications in the said agreement mentioned". Section 2 of the

1883 Act provided that:-

"The said hereinbefore recited arrangement (i.e. the Fenton

Agreement) and agreement (the Clarke Agreement) are hereby

confirmed, and shall be deemed to have been valid and

effectual as from the twentieth day of November, one

thousand eight hundred and eighty-one, and shall be deemed

and taken on that date to have conferred on and given to

the Governor all the rights, powers, and authorities

specified or mentioned in the said Act in respect of the

said lands the subject of the hereinbefore recited

arrangement.

- 23 -

3.11 Perhaps not altogether surprisingly, the passage of the

1883 Act through parliament was marked by some concern about the

amount of land proclaimed under the 1881 Act. One Mr Holmes

said:-

"The quantity of land, for example, was much greater than

they had imagined when they passed the Thermal Springs

Act; he believed it extended to six hundred thousand

acres. He knew that the extent of the reserve on account

of these Thermal Springs was vastly larger than they had

imagined would be reserved at the time the Act was

passed. ,,54

But Whitaker, the Premier, defended the government's actions

vigorously:-

"The object was to prevent these springs being used by

private individuals starting grog-shops, and making a

number of small settlements over which there would be no

control, and to include the chief springs in one block.

That was why 600,000 acres were taken. When he said

'taken' he did not mean that it was taken from the

Natives: the Government took the management of it for the

benefit of the Natives. ,,55

3.12 The principal issue by 1883 had become the Thames Valley

and Rotorua Railway Company's proposed line to Rotorua. The

Rotorua chiefs seem to have been keen to have a railway link with

Rotorua, so much so that they were willing to donate land to the

railway company both for the purpose of providing land for the

track and stations and to allow the company to float its

debentures in the English market. The Crown had itself concluded

separate agreements with the railway company and the Maori

landowners 56 to facilitate the venture, and specific provision

authorising these further arrangements was included in the 1883

Act. 57

- 24 -

C. The 1910 Act

3.13 This was the last in the succession of special enactments

for the thermal-springs districts. Its main objective was to

close the Crown's title to the Pukeroa-Oruawhata block and to

extinguish the few remaining shares in the block which the Crown

had been unsuccessful in obtaining by private negotiation. It

also facilitated bringing to an end the special regime for the

region and throwing it open to European settlement, although

actual sites of thermal springs remained protected58 . Mokoia

Island was made an inalienable reserve59 .

4.0 THE SCENERY PRESERVATION ACTS

A. Scenery Preservation and Thermal Springs

4.1 The first statute concerning scenic reserves in New

Zealand was the Land Act 1892. By s.2 of this Act, the Governor

was empowered to set aside from sale areas of Crown land for

reserves for the protection of scenery or of "natural

curiosities". This was taken a step further with the Scenery

Preservation Act 1903 which allowed private land to be

compulsorily taken for the purpose of scenery preservation.

4.2 In 1904 Haupeta Hautehoro (of Rotorua) and about 100

others lodged a petition objecting to the compulsory taking of

Maori land for the purposes of scenery preservation. The

petition states:-

"We your petitioners earnestly protest against section 5

of part 2 (ss.2 of s.5?) of "The Scenery Preservation Act

1903" aforesaid, which provides that certain portions of

Native Lands be taken under this Act, and fixes the

payments for the said Maori lands, and the paying of

monies into the hands of the Public Trustee.

The Maori lands that will be taken under this 'Scenery

Preservation Act' are, the famous places, the lands

- 25 -

containing thermal springs, the famous pas, the canoe

landing places of former days, the sites of famous whares,

the sacred shares, the bird snaring places of olden time,

that is to say all such places as are understood by this

Act as likely to be much frequented by the Tourists of the

World who visit here.

And the Maoris who are the owners of the said lands will

be left to die; sufficient as to that. If any Maori or

Maoris desire to work the timber on his or their lands as

a means of earning money, or to clear the bush for a food

cultivation, he will be fined £100.

Therefore we your petitioners will continually pray to

your Hon. House that this Act shall not apply to Maori

lands.

This is a very serious punishment to inflict upon your

Maori people; inasmuch as your Honorable House has

already passed another Act to preserve the balance of the

Lands of your Maori people (i.e. the Maori Lands

Administration Act).,,60

In response Mr C.R.C. Robieson, the Acting-Superintendent of the

Tourist Department, advised the Minister for Tourist and Health

Resorts as follows:-

" ... In general the Native suffers no more hardship than a

European in cases where the Government requires any land

for the purposes of this Act. The terms of acquirement

are the same as under the Public Works Act

1892 ..... However, to exempt Native land from the

operations of Clause 5 would practically nullify the

effect of the Act as the bulk of the scenic and historic

spots, especially in the North Island! are either Native

owned or Native reserves. ,,61

- 26 -

The 1903 Act was amended in 1906, and on that occasion all

references to Native land were removed from the Act 62 . This

protection was, however, in turn removed in 1910. Section 10 of

the 1910 Act also validated takings of Native land for scenery

preservation "prior to this Act" - the significance of which will

become apparent when the acquisition of Waiotapu is discussed.

4.3 Acquisition of areas of land which contain thermal springs

was a principal purpose of the Scenery Preservation Acts. The

Long Title of the consolidating 1908 Act described it as:-

"AN ACT to consolidate certain enactments of the General

Assembly relating to the Acquisition of Lands of Scenic or

Historic Interest, or on which there are Thermal Springs."

The 1903 Act established a Scenery Preservation Commission. Its

task was to tour the country and to make recommendations as to

whether areas of land (in Crown, private of "Native" ownership),

should be reserved as "scenic", "thermal" or historic reserves.

Within two years of its establishment in 1904 14,565 acres had

been reserved. In 1904 the Assistant Inspector of the Tourist

Department at Rotorua urged that Lake Rotokawa be taken under the

Act. His report to the Acting Superintendent of the Tourist

Department gives an interesting description of Rotokawa in the

first decade of this century:-

"Rotorua, July 3 1904:-

Sir,

I herewith forward you the report of my visit to Roto

Kawa. I visited Roto Kawa in company with Messrs

Crowther, Ingles and Mr Howe all of Taupo district and who

know Roto Kawa well.

I made a very careful examination of the whole place and

found it to contain a number of boiling sulphur springs

- 27 -

and two very fine sulphur caves, the fumes would of course

prevent any person from entering the caves.

I would say that the property containing the springs and

sulphur beds would be about 300 acres. Their [sic] is no

doubt that the whole place is nothing but sulphur under

the outside crust. I noticed that visitors are in the

habit of digging for sulphur specimens which is defacing

the place and I think something should be done to stop

this. The lake is a very pretty one and it is simply

swarming with wild ducks. The land around the southwest

side of the lake is of good soil and would grow anything,

but the rest of the block which contains 2776 acres is

poor.

I am strongly of opinion that the Department should have

the whole of the springs and the sulphur beds reserved

with its lake. I am sending you a map of the District and

I have marked in red ink what I think the Crown should

resume ... "

J.G. Ward, the Minister for Tourist and Health Resorts forwarded

this on to the Chairman of the Scenery Preservation Commission,

but the file was noted:-

"Native Land. Action Cannot be Taken under Scenery

Preservation Act at present. ,,63

4.4 Relations between the Scenery Preservation Commissioners

and Maori landowners had been difficult, as is shown in Apirana

Ngata's speech on the Scenery Preservation Amendment Bill in

1906 64 :-

"Mr NGATA (Eastern Maori District) said he did not like to

let that opportunity pass without making a few comments on

the Bill. He did not want it to be understood that there

had been any organised opposition on the part of the

~ative race to the government taking historic and other

- 28 -

spots as reserves under the Act. The objection of the

Native people had been to the manner or method of

reserving certain of these areas. While admitting that

most of the historical spots and old burial-grounds should

be reserved, under such protection as would ensure their

protection from acts of vandalism in the future, there was

a suspicion in the Maori mind that in the matter of

compensation they did not receive full justice - that

there was a disregard of what I [sic] he might call the

sentimental side of the question. During the last three

years a great deal of dissatisfaction had been felt by

Natives throughout the colony - and more particularly by

the Maoris in the Hot Lakes District - with respect to the

action of the Commissioners under the Act of 1903. It

very often happened that the Commissioners held their

meetings a hundred miles from the lands proposed to be

taken, and they made recommendations and reservations

without viewing the spots proposed to be reserved. They

were guided to a great extent by the reports of interested

persons in the district, without, in many cases,

consulting the Natives concerned; and owing to that a

great many spots that should have been reserved had been

deliberately destroyed by the Natives as a sort of protect

against the methods of the Scenery Preservation

Commissioners."

B. Compulsory Acquisition at Waiotapu and Awakeri 65

4.5 The principal thermal area under Maori ownership taken

under the Act was Waiotapu. Administration of Waiotapu had

involved numerous problems, and the Tourist Department built up a

substantial file on the place in the early twentieth century (TO,

1, 1901/36, Waiotapu Reserve). Various persons complained that

the Maori owners were over-charging for conducting visitors

around the thermal area (4s. per person). There were other

problems, such as when a tourist named Fitchett carelessly set a

sulphur patch alight (fortunately the fire was put out before too

much da~age was done), or when another group of tourists only

- 29 -

narrowly missed being scalded to death from an exploding mud

volcano. There were problems with cattle belonging to Mr

Falloona, the tavernkeeper at Waiotapu, damaging the thermal

features. Government land at Waiotapu was originally used not

for any tourist purpose but as a prison, giving rise to concern

about the supposed menace to tourists posed by escaped criminals.

The Tourist Department had raised with the Department of Lands

the possibility that the Maori-owned part of the reserve be

compulsorily taken, and this idea received encouragement when in

1907 Rukingi Rotohiko Haupapa of Ohinemutu wrote to the

government stating that he wished to sell his shares in the

Waiotapu Block66 . Other others, however, were unwilling to sell.

4.6 The precise sequence of events at Waiotapu is rather

difficult to reconstruct. In September 1907 it appears that a

sizeable area of Maori land at Waiotapu was taken, pursuant to

the Scenery Preservation Act 67 which was probably illegal, since

the Scenery Preservation Act did not at the time allow the taking

of native land. A further source of confusion was that on 27

January 1908 the Engineer in Charge, Department of Tourist and

Health Resorts, Rotorua, wrote to the General Manager of the

department at Wellington urging that the Maori land at Waiotapu

be taken. This is puzzling in that this was, firstly, illegal

and, secondly, appears to have been done already. There was a

further proclamation re~ating to land at Waiotapu in 1908, but

this relates quite clearly to an area which was already Crown

land. (See NZG 1908 8937). Presumably the confused state of

affairs at Waiotapu was the reason for s.10 of the Scenery

Preservation Act 1910 which, as already indicated, validated the

taking of native land prior to the 1910 Act. By 1908, in any

case, the whole of the Waiotapu reserve was in Crown hands. This

transaction really does deserve close examination, as it appears

that the Crown illegally acquired compulsorily Maori land

containing surface geothermal features against the will of the

majority of the owners, and then validated its own actions with

retrospective legislation in 1910. A further thermal area taken

under this Act was Awakeri - see para. 7.11, below, and fn.111.

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5.0 THE DECLINE OF THE SPA IDEAL

5.1 The apogee of the Government's hopes to create a European-

style spa based on the health-giving properties of geothermal

waters came in 1908. On 13 August of that year Sir Joseph Ward

and Admiral Sperry of the American Pacific fleet opened the new

bath-house at Rotorua (the building in the Government gardens now

usually known as "Tudor Towers"). The driving force behind the

building's construction was Dr Arthur Stanley Wohlmann,

Government balneologist at Rotorua since 1902, and the building

had cost something like £40,000.00 to build. The surrounding

area was developed in order to assist in the creation of an

ambience resembling one of the great European spas. Rockel

writes:-

"The Tourist department also attempted to make Rotorua and

the gardens attractive. The tea house opened in the

grounds, now known as the Government Gardens, became the

social centre of Rotorua. A band rotunda was built and

bowling and croquet greens and tennis courts were added.

In the town metal was spread on the pumice roads ..... Dr

Wolhmann regretted that a casino could not be installed in

the bathhouse; many wealthy visitors to the spas of

Europe were partly attracted by the opportunity to gamble.

Wohlmann emphasised the importance of social life in the

bathhouse, as the centre of the Rotorua spa. The entrance

hall became the equivalent of the English spa's pump room

or the German kursaal, a place to shelter in bad weather,

to listen to light music and to rendezvous in the evening

..... An aviary and monkey house were installed in the

gardens and a camera obscura was built on the games-ticket

office in the grounds, its kaleidoscopic effects no doubt

emphasising the cultured retreat atmosphere of the

Edwardian spa68 .

The bath-house offered a number of allegedly curative treatments,

some of which sound very strange today. These include radium

water treatments (supposed to reduce blood pressure and blood

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sugar levels and to tighten loose teeth) the "Greville hot air

bath" and the "Electric Light Bath". Most of the treatments

involved the less controversial methods of soaking in hot thermal

waters.

5.2 At Te Aroha, also (like Rotorua) linked by rail with

Auckland a rather smaller but in some ways more attractive spa

was also laid out by the Tourist Department, featuring drinking

fountains, bath-houses and a tea shop. The rather charming

buildings are now all preserved in the Te Aroha domain69 .

5.3 The hot springs at Whakarewarewa, Waimangu, Waiotapu and

other places were seen as supplementary attractions for visitors

to the central North Island spa resorts. As has been seen at

Waiotapu, the Tourist department tended to favour government

ownership of the hot springs where possible. Waiotapu was,

however, rather difficult to get to, and the main tourist

attraction at Rotorua after the destruction of the Pink and White

Terraces was undoubtedly Whakarewarewa. By the turn of the

century most of the land in and around Whakarewarewa was owned by

the Crown, but the central part of the thermal area remained

Maori-owned, sandwiched between Crown land on either side of it.

Here the Tuhourangi community remained, carrying on their

traditional lifestyle - often much to the irritation of local

inspectors of works and officials of the tourist department. In

1906 the inspector of works at Rotorua complained to the

superintendent of the department that local Maori persisted in

cleaning potatoes and fish in some of the hot springs "and in

fact I have had to draw the attention of the Sanitary Inspector

to the matter, but it made little difference with the Natives,,70.

The inhabitants of Whakarewarewa seem to have entered into one of

the first commercial uses of geothermal water when they arranged

a lease of hot water with Messrs Nathan & Co. who used it for the

so-called "Oil Baths" a short distance away71. The proximity of

Maori and Crown land at Whakarewarewa seems to have given rise to

endless petty disputes, concerning such matters as tolls and

cooking and washing clothes in the hot pools. The inhabitants of

the village were particularly concerned to maintain some control

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over the benefits to be derived from tourism, and resented any

attempt to use guides who were not from the village. These

myriad disputes reflected the quite natural tensions between

those who wanted to turn Rotorua into a showcase for

"respectable" tourists and those who wanted nothing less than to

carryon with their traditional lifestyle.

5.4 The apogee of the spa era was short-lived. Rotorua was

too isolated and backward to compete as a serious rival to the

great spas of Europe. Modern medicine gradually came to discount

the therapeutic benefits of soaking in mineral waters and mud

baths. The bath-house at Rotorua was furthermore plagued with

horrendous maintenance problems. The concrete arches in the

building began to crack and the plaster began to fall away from

the ceilings. The building's design was defective in that it

failed to ventilate properly. According to Rocke1 72 :-

"For some unknown reason the ventilating shafts and open

rear basement were blocked in so that steam built up when

the building was closed overnight. On some frosty

mornings the doors had to be left open for several minutes

before anyone could venture in."

By the 1940s "things at the Bathhouse were in a desperate state".

There were a number of meetings to discuss the fate of the

building. At one of these73 :-

" ... Mr Dan Kingi, representing the Ngati Whakaue people of

Ohinemutu, urged the Government to retain the bathhouse

for its original function. He believed this would keep

faith with the elders who had made a gift of the area, now

occupied by the Government Gardens, for health and

recreation purposes."

The building was last used as a bathhouse in 1966.

5.5 In this evidence I have not attempted to deal at length

with areas of land gifted by Ngati Whakaue and other tribes at

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Rotorua for public purposes. The Fenton agreement specifically

sets aside "Te Pukeroa" as a "Reserve for Public Recreation for

everybody" - Kuirau Park. As mentioned, other land was made

available by the tribes, Ngati Whakaue in particular, to

encourage railway development. The setting aside of the area now

known as the government gardens must have been by a separate

process after the conclusion of the Fenton agreement.

5.6 The collapse of the ambitious dream did not mean the end

of Rotorua as a tourist centre, but the objectives shifted from

an attempt to recreate Baden-Baden or Cheltenham in the South

Seas to the more modest one of a tourist industry based on the

hot springs and use of thermal pools for recreational rather than

medicinal purposes. Some of the thermal areas were owned by the

Crown; others such as Tikitere, the central part of

Whakarewarewa, Orakeikorako and Ketetahi on the slopes of Mount

Tongariro were Maori-owned. A few were privately-owned, most

notably Geyser Valley at Wairakei. It was not until after World

War II that interest shifted from the value of the resource as a

tourist asset to its value as an energy and industrial resource.

6 • 0 THE GEOTHERMAL RESOURCE AS AN ENERGY RESOURCE: THE COMMON

LAW BACKGROUND

A. Introduction

6.1 Thus far the focus has been on the geothermal resource as

a resource valued by the Government as a tourist attraction.

Thinking of the resource in this way meant that legal questions

concerning ownership of the resource as a whole had no particular

relevance. The assumption seems to have been simply that those

who owned the land on which were located geothermal springs could

use them and develop then as they wished. Private arrangements

were made by which owners of hot springs allowed water to be

diverted by channels or pipes as, for example, in the water lease

arranged between Nathan & Co. and the Maori community at

Whakarewarewa, whereby water was diverted by pipe from one of the

large h,ot springs on Maori land to the "Oil Baths" on Nathan 's

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premises. Bores tapping into underground geothermal systems

certainly must have existed prior to the enactment of the

Geothermal Energy Act in 1953, but I have not found so far any

material on what the legal regime governing underground

geothermal waters was supposed to be in these early years. It

seems safe to assume that the question was one of marginal

importance.

6.2 Until the enactment of the Water and Soil Conservation Act

in 1967 water law in New Zealand was essentially governed by the

rules of the common law. Statutory inroads such as the Water

Power Act 1903 were of minor significance. The Soil Conservation

and Rivers Control Act 1941 did not affect common law rights in

respect of natural water. The Thermal-Springs Districts Acts, as

we have seen, had little to do with thermal springs per se -

their principal effect was to give the Crown a monopoly of land

purchase in an extensive region. The Acts did not themselves

impact on common law rights to surface and underground geothermal

water.

6.3 The common law never has developed a body of rules to deal

with property interests in geothermal systems. This is hardly

surprising. The technology to exploit such systems on the scale

seen at Ohaaki or Wairakei has come into existence only recently.

In any event geothermal systems do not exist in England to any

significant extent, although certainly hot springs are found

there at Bath, Cheltenham and other places. Thus the common law

"rules" with regard to geothermal water can only be discussed by

way of analogy. Geothermal systems can create surface pools and

streams and thus one analogy is the law relating to surface

water. Another analogy, the one which seems to be most relevant,

is the body of rules dealing specifically with percolating or

groundwater. However, it has to be recognised that although

geothermal systems are water systems, the geothermal resource is

an energy, rather than a "water" resource. This perhaps puts

geothermal resources more on a footing with energy resources such

as petroleum and natural gas. Lastly, geothermal systems contain

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minerals in solution, which means that the common law rules

regarding mineral ownership are relevant too.

6.4 The following section is intended as a background to the

1953 legislation. It will focus, firstly, on geothermal

resources considered as water, before dealing with other aspects

of the common law which may be relevant.

B. Surface Water

6.5 It seems unnecessary to develop this at any length. At

common law all water, whether surface water or groundwater,

belongs to no-one until abstracted. Landowners own the beds of

lakes and streams - a lake (or a geothermal pool) is simply land

covered by water. The result is that in terms of surface pools

the landowner has no property in the water itself until it is

abstracted. On the other hand, only the landowner can use the

water in the pools on his or her land - crossing the land to take

the water would be a trespass if committed by persons other than

the landowner. The riparian rights doctrine would apply,

although it is hard to see this as having much relevance to

geothermal features. These points will be developed in detail in

the next section.

c. Groundwater

6.6 The common law rules about groundwater have as their

starting point the common law rules about water generally. At

common law water was not something capable of ownership until it

had been abstracted. Water, as such, belonged to no-one.

According to Halsbury's Laws of England74 :-

"Although certain rights as regards flowing water are

incident to the ownership of riparian property, the water

itself, whether flowing in a known and defined channel, or

percolating through the soil, is not, at common law, the

subject of property or capable of being granted to

pnybody. Flowing water is only publici juris in the sense

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that it is public or common to all who have a right of

access to it."

But, once abstracted, the water becomes the personal property of

whoever has abstracted it75 :-

"Water which has been appropriated or taken into possession

from a known and defined channel is the subject of

property, the right of property existing only during such

possession, as is also percolating water [i.e.

groundwater] which has been appropriated, even by the

artificial means of pumping."

Thus it is theft at common law to divert water from some other

person's pipes: Ferens v O'Brien (1883) 11 QBD 21.

6.7 A key difference with the rules relating to groundwater is

that there is no counterpart to the riparian rights doctrine

applicable to surface water. Generally a riparian owner (a

landowner through whose land water flows above ground in a

defined channel, as in a river or stream) has a right to the

maintenance of the flow both as regards water quantity and water

quality. It is unlawful for an upstream owner, for example, to

take water from a stream, or pollute it to such an extent, that

the "natural" quality and quantity of the water (from the view

point of the downstream landowner) is impaired. But there is no

equivalent rule relating to subsurface water. Any landowner can

draw off as much subsurface water as he or she likes - even to

the extent of completely depriving neighbouring landowners to any

supply whatever. Halsbury again76 :-

"The common law confers no rights in respect of

subterranean water running in undefined or unknown

channels, except that the owner of land may sink wells in

his own land and so obtain a supply of water ,although

another owner, by doing the same, may draw off the water

from his neighbours."

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Furthermore77 :-

"An owner of land under which there is subterranean

water not in a known and defined channel has no right at

common law to the support of such water and his neighbour

may draw off such water as he pleases. Furthermore, water

in an unknown channel or percolating water cannot be the

subject of prescription or grant, and its diversion by one

landowner may not be challenged by another, whatever the

former's motive for doing so may be and however long the

latter may have enjoyed the use of the water."

Assuming then that geothermal water is (in the rather archaic

language of the common law) "percolating" water there is no right

of property in it whatever. It belongs to whoever appropriates

it (putting to one side the small problem that when geothermal

water is "appropriated" it is at that point often no longer water

at all). No landowner can complain if an adjoining landowner

manages to abstract all the geothermal fluid in the

neighbourhood; nor does the common law offer any protection to

those who have put down bores or wells first. Any newcomer can

move in next door and appropriate all geothermal water in the

system, if he or she is so minded. In short, the common law in

its pure form gives no right of priority and no protection to

existing users.

6.8 It must be emphasised that the above rules do not mean

that anyone at common law can take groundwater. To move onto

someone's land and take groundwater would be a trespass. One

consequence of the common law rules is that leases, easements and

licences aside, no-one can have access to groundwater except

landowners. Although there is no property right in groundwater,

the common law does not recognise any public right of access to

it.

6.9 The different rules relating to surface water and

groundwater did not emerge in England until the decision of the

Exchequer Chamber in Acton v Blundell (1843) 12 M & W 324, 152 ER

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1223. One can only guess as to why the issue had not arisen

until then - one possible explanation is that it was not until

the nineteenth century and the emergency of steam-driven pumps

that the technology became available to seriously deplete an

adjoining landowner's supply of groundwater. In this case the

plaintiff was a manufacturer, carrying on the business of cotton-

spinning. The plaintiff relied on the flow of groundwater from

various underground springs to fill wells which in turn supplied

the mill. The defendant, an adjoining landowner, had

subsequently sunk coal-pits adjacent to the plaintiff's land.

This had had the e